March 24, 2025
“The problem with political jokes is they get elected.”
The Real Polar Bears
THANK YOU, THANK YOU!
THANK YOU, THANK YOU!
The SPECIAL OLYMPICS MONEYTALKS team 2025 thanks our illustrious leader Michael Campbell, brave-hearted Premier Gordon Campbell, the fit MP John Weston and me, Mr. Lederhosen… but MOST OF ALL the plungers or donors who took action! THANK YOU…! YOU!!!…WHO DONATED!
We raised $56,940 for a great cause because of YOUOUOU!
AGENDA
- MUST DO RIGHT NOW!
- QUICK NEWS
- GORDON AND MIKE CAMPBELL PLUS OZZIE GO FOR A SWIM
- PRESALE? FOCUS ON YOUR DEAL!
- AIRBNB AND ALL STR UNDER WORLDWIDE ATTACK
- 3 NUMBER GRAPHS –
-running total sales down 50%!
-highest price achieved
-4-year February comparison - TORONTO/CALGARY/VANCOUVER CRASH IN NEW HOME SALES
- AI / DEEPSEEK SCARES INVESTORS
- $90 MILLION IN CLAIMS FROM HOMEBUYERS
- CANADIAN/US/EUROPE
- FORECASTS
- INFLATION/ECONOMY
- EBY LIKES INVESTORS NOW? (MONEY)
- EERIE PREDICTIONS COME TRUE
- QUESTIONS AND ANSWERS
- NOT TO BE MISSED SHORT VIDEOS (SUBSCRIBE AND LIKE)
URGENT ‘YOU MUST DO’ NEWS!
1. Speculation Tax (must file by March 31, 2025) BC.
How much? 0.5 percent for BC owners. 1% for foreigners and satellite families. Will double next year. Remember: More areas added! Check it here.
2. Underused Housing Tax – filing by April 30 (penalties UP TO $10,000) … Federal.
If you are a partner or trustee and others even if Canadian you must pay and file. Penalties $10,000.
3. Premier Eby announced a sudden change in the Secondary Suite Incentive Program. This program offered forgivable loans covering up to 50% of renovation costs, up to $40,000. It is NOW CANCELLED. Must apply by March 31, 2025!!
4. BC Financial Services Authority (“BCFSA”) has introduced regulatory changes that include an extension to the early marketing period (by 6 months for projects over 100!) and a new consumer disclosure form requirement for disclosure statements. Real estate developers / realtors must understand the extent and effect of the changes. Fasken discusses the new pilot program here: marketing.communications@fasken.com
5. Newly appointed Prime Minister Mark Carney has called a snap federal election for April 28, 2025. OK, I am an ‘apolitical blog’ but I urge you to VOTE! Take a piece of paper and write down how each party’s policies align with your personal values. Think about the long-term implications of these policies on your daily life and future generations. Then measure against previous promises made and not kept and how valid future promises are. Oh, and remember: Polls are a joke. BUT YOU MUST VOTE!
OZZIE COMMENTS
QUICK NEWS
TARIFFS AND TRUMP ARE TO BLAME FOR LOW SALES?
Nope: Blame Trump on being a bully etc., but the Vancouver and Toronto real estate sales market have been in a free fall since 2020. Tariffs don’t help but we were in a sales free fall long before the ‘tariff wars’. Not due to Tariffs or Trump. Look at the 50% decline in sales in Vancouver and the 28-year low sales of all new construction in Toronto. However, more Trump below.
ECONOMY / INFLATION
US/CANADA/EUROPE
To the extent that we had ‘magnificent 7’ and other high flying stock markets, we were living in a magnificent Wealth Effect dream. Traditionally a Wealth Effect has a positive effect on individuals and thus any economy. That is now changed. And … it will keep changing. We have had a sharp, massive wealth drop. A full 12% of US GDP has been lost. I mean look at giga tech stocks down -15%, semi conductors -22%. Equal Weight conductors -30%, Nasdaq down-14%. S&P -10%. OUCH!
In addition the massive 32 percent crypto crash also proved that there is no safety in Bitcoin. At least currently, it rises and falls with the S&P and other major stock markets. There is also in my view massive manipulation from dark pools and mega funds going on, wiping out retail traders. As in you and you.
Regardless of where YOU stand … reality is that this has had and will continue to have a visible impact on households – now going into negative territory. They are already overweight in equity and crypto losses and now may feel a ‘my wealth is gone’ shock.
We see a recession in the offing … again (I know, I know). But we are only concerned with the question: Whither real estate? Well, if February is any indication and you add the massive sales crash since 2020, we are also (in TO presales etc.) going to be in for a real estate shock.
We say that we have strong consumer resilience. Maybe that’s true but in all of North America we see cracks. We also still have a pending swarm of mortgage renewals; huge listing increases and income tax that has to be paid in April if you have been a winner in stocks. So, we expect April is not going to see much of a recovery.
EUROPE
Germany is seeing a huge shift from a fixed debt ceiling to massive increases in spending not seen since the fifties – military and energy. This targeted huge stimulus will have an inflationary impact right in the middle of a sharp economic downturn. Can you spell infla/stagflation?
Germany and Britain face huge immigrant problems (call it Merkel’s legacy), stagnant economies and a confused populace. All of Europe is analyzing its immigration policies. May be too late. Three years ago I recommended Douglas Murray’s book “The Death of Europe”. Eerie predictions then, facts now!
TRUMP
Trump tariffs, will be negotiated on a ‘reciprocal’ basis. So, jury is still out. Wait for it.
BUT, while I may wholeheartedly agree with his anti-war, anti drug, anti woke stance, I intensely dislike his other tactics. Calling our Prime Minister a governor and making continuous other derogatory remarks: Canada negotiates in bad faith, Canada 51st state, etc. Really? Worse … forcing Ukraine to give the US cheap minerals or no weapons. That’s not negotiation that is blackmail. Unacceptable! A dictator’s gun to the chest. On the other hand we need our Government to step up to the plate and NEGOTIATE from strength, not talk, action!
US / CANADIAN DOLLAR
With the bond rates falling and a further 2-time drop-in rates in the US and the same in Canada, there is a worrying trend. Investors are getting weary and taking their money out of US stocks AND bonds and even out of the country. Also Japan and China are holding huge amounts of treasuries and have reportedly started selling them against pending tariffs. Not a lot of threats (like Trump) but quiet action, which is actually more worrying. That presages a weaker US dollar with Canada falling further.
Investor money leaving? If it continues. Dollar range bound as in lower!
AI: DEEPSEEK and OPEN.AI
In my view the main reason the top US stocks crashed, was that they had all announced billions of investments in AI. Investors were comfortable with that, even expecting no return this year until that was done and kept investing. However: Shock and Awe from China!
It was indeed DeepSeek’s intro of a cost-effective AI model that led to the massive sell-off in U.S. tech stocks. Notably, Nvidia’s stock plummeted by 17% in a single day, erasing approximately $593 billion in market capitalization—the largest one-day loss in U.S. history. This event wiped out around $1 trillion from U.S. market value, reflecting investor concerns over the competitive threat posed by DeepSeek’s efficient AI solutions.
Major Point: DeepSeek’s (and others) ability to develop advanced AI models at a fraction ($6 million instead of $6 billion) of the cost incurred by U.S. firms has prompted a re-evaluation of investment approaches. For instance, Microsoft canceled several U.S. data center leases, totaling “a couple of hundred megawatts,” indicating a reassessment of its AI infrastructure investments. Amazon started a mega cost cutting in layoff program etc. (see below).
SHORT TERM RENTALS DILEMMA (STR) – AIRBNB COLLAPSING?
Cities in Britain, Australia, USA, Canada and elsewhere are attacking STR blaming it for all the woes, that actually are caused by rising construction costs, municipal fees and continued tax increases. NOW, investors are increasingly leaving the (STR) market and halting new developments due to a convergence of economic pressures, regulatory challenges, and evolving market dynamics:
1. Economic Pressures:
- Rising Interest Rates (Although Canada, will see more decreases)
- Decreasing Occupancy Rates: Post-pandemic travel patterns have shifted, leading to reduced occupancy rates in many STR markets.
- Insurance: Owners see many non-renewals and/or huge increase in premiums.
2. Regulatory Challenges:
- Stricter Local Ordinances: Many municipalities/cities have implemented stringent regulations on STRs to address housing shortages and community concerns.
- Increased Taxation: Jurisdictions like Victoria, Australia and elsewhere have introduced higher taxes on second homes and short-stay accommodations. These factors collectively contribute to a challenging environment for STR investors, prompting many to exit the market and reconsider new developments.
- Presale buildings that were built for investors looking for better returns in STR are forbidden, with the result that preconstruction is crashing everywhere.
In the US, reports abound that on an inventory of 800,000 – 1.2 million of STR properties more than 40% are under pressure, losing money. In addition to the above, they feel forced into a sale. Added costs, special fees and outright bans add pressure. Insult to injury? Occupancy rates are falling in general, some areas to 48 percent.
What does in mean? Everyone is selling. Listings of properties previously used as STR are soaring. STR listings for sale in many areas (as a percentage of overall listings): To note:
Palm Springs 15.2% of the overall listing markets are now STR. Asheville 15% (blame new tax), Gatlinburg increase 44%, Myrtle Beach increase to 38%, Panama City 38%, Sedona 35%. All blaming new regulation limiting permits, etc.
Major Point: As an owner, you have to make a tough call. Is it going to get worse? Well, it is a worldwide attack! Until all investors are gone, they will attack current owners, looking for a short-term bump in long term available housing stock by killing STR, Airbnb and others. But if no one is building?
For you, if you are losing money, time to sell should be sooner rather than later. See your best realtor, look at your local market conditions. Because you are in a war, you can’t win … at least in the foreseeable future.
US LUXURY RENTS
New data from Redfin shows that nearly 3/4 of the most populous U.S. metro areas (35 out of 50) have seen an increase in wealthy renters, with Raleigh, NC, and Orlando, FL, leading the trend.
In Raleigh, affluent renters WENT from 4.8% in 2019 to 7.7%. Orlando at 10.8% (up from 8.5%), Buffalo, NY (6.6%, up from 4.6%), Tampa, FL (9.4%, up from 7.9%), and San Diego (9.3%, up from 8%). According to Redfin Senior Economist Elijah de la Campa, “Many affluent Americans are opting to rent rather than buy because home prices have surged far more than rental costs in recent years. With mortgage rates near 7%, renting allows them to allocate funds toward other, potentially more lucrative investments.”
Major Point: In today’s high-cost markets the massive increase in costs, insurance, taxes, regulations etc. renting your luxury residence may be an option. NOTE: As long as you also invest in low price, high rent cash flow properties in another area.
“LARGEST CLAIM EVENT IN ITS HISTORY”
Tarion, Ontario’s new home warranty program, is confronting an unprecedented challenge as it braces for over $90 million in claims from homebuyers. This situation, described as the “largest claim event” in its history, arises from builders abandoning projects, leading to significant financial losses for consumers.
EBY ASKS A QUESTION
Premier Eby has been outspoken about his dislike for real estate investors, and landlords, etc. He hit investors with STR, introduced and increased the Spec tax and brought in a flipping tax. He also brought forward anti-landlord legislation.
Last week he (seemingly) had a shift in attitude when he addressed the BC Real Estate Association (BCREA) in Victoria. There he acknowledged the role of real estate investors in enhancing housing supply. He expressed interest in harnessing investment capital to increase housing availability, stating, “How do we harness that energy around investment… and do it in a way that facilitates access to more housing for people?” Also: He voiced his intention to support small-scale landlords.
Major Point: Easy answer? Yes, most investors are looking for a return on investment. Many landlords are going bankrupt operating under current Tenant Act. Plus government increases taxes, costs are rising, and landlords cannot recover. So they want out!
SUMMARY OUTLOOK
We have been and will continue to be in for a WILD RIDE: UNCERTAINTY, FEAR and lack of CLARITY in all of 2025.
Huge layoffs by the thousands in North America, wiping out a lot of middle management. I.e.: Amazon is undergoing a huge reconstruction of its total organization. The company plans to eliminate approximately 14,000 managerial positions in 2025, representing a 13% reduction in its global management workforce. It’s supposed to save between $2.1 billion and $3.6 billion per year. The total number of managers will decrease from 105,770 to 91,936. Many other companies follow. Look at who also announced last month:
- Siemens lays off 6,000, Morgan Stanley 2,500, Citigroup 20,000 to save $2.5 billion, Starbucks 1,100, Chevron 8,000, Southwest 2,200, Meta 3,600, US Government plans massive layoffs (US) – IRS alone 45,000. Too many to list.
- The world as we know it and watch is – she is a’ changing. Change with it or die!
AI was going to force restructure. Now CHEAP AI will change our world!
Many companies now insist that employees work at the office for at least a minimum of 3 – 4 days. Watch my short video: (youtube.com/jurockvideo) “People do what you inspect not what you expect.” Oh, and DEI is dead for now.
You get the message: Massive layoffs, tariffs, money leaving, stocks down, wealth effect dead…. Recession, election. UNCERTAINTY!
What about real estate? I always believe that in this money printing environment real estate will still be the best safe investment. But, please dear reader, look and study my four pillars in your area and apply:
INFLATION? TIMING? TREND? CYCLES?
Now it is TIMING. Traditionally, when people feel poorer, they sell cottages and other recreational properties first, they speculate a lot less, new construction slows. E.g. Appliances sales are in 40-year decline. So, for the 2nd quarter at least: Cash is not trash! (Unless you get the deal of a lifetime.)
MUSICAL THOUGHTS
If in Vancouver, come see MADAME BUTTERFLY (April 26 to May 4. I’m going May 1). Giacomo Puccini’s opera about true love, betrayal. Prepare to cry.
To cheer you up. No old guys rocking but a new young acrobatic star. Like him: Watch him fly: BENSON BOONE in concert – beautiful things
https://www.youtube.com/watch?v=USDhRcsUY90
WANT SOME CLARITY? Martin Armstrong with Michael Campbell
“We have never seen the mainstream mania lie so much”. Michael Campbell and Martin Armstrong just did a new must-see FREE video: https://www.youtube.com/results?search_query=campbell+an+armstrongRemember: You are reading Ozzie’s opinion, not advice! And, yes, I have lots of opinions! But use only your personal professional lawyer/realtor/accountant/ to make any personal investment.
THE NUMBERS, THE NUMBERS
TORONTO
February sales down 32% in SF and 22%-30% in TH and condos.
- Active listings up 76%
- Prices within 4% lower (SD)
Globe and Mail:
“Preconstruction condo prices tumbled 15 per cent in the Toronto region in the last three months of 2024, with sales plummeting to lows not seen since the late 1990s.”
CALGARY
Sales down 19%, listings up 76%, prices about even!
BRITISH COLUMBIA
The British Columbia Real Estate Association (BCREA) reports that 4,947 residential unit sales were recorded in February 2025, 28 per cent lower than the ten-year February average. The average MLS® residential price in BC in February 2025 was down 2.4 per cent at $964,349 compared to $987,811 in February 2024.
VANCOUVER
3 ways to look at the numbers:
- Looking at a full year ‘rolling total’ of the last 4 years
- Comparing February prices and sales to the highest ever achieved
- Comparing February sales/listings to the Februarys of 2025/24/23/22/21
1. WE USE THE ROLLING 12 MONTHS between FEB 28 – FEB 28 the following year. Eyepopper!
Vancouver INCREDIBLE 12 mos. RUNNING TOTAL (SF) – 50%
FEB 28, 2020 – FEB 28 2021 sales 13,807
FEB 28, 2023 – FEB 28 2024 sales 7,469
(End of Feb 2021 SF sales clocked in at 11,661, Condo sales at 15,146)
FRASER VALLEY INCREDIBLE 12 mos. RUNNING TOTAL (SF)
FEB 28, 2021 – FEB 28 2022 sales 11,233
FEB 28, 2024 – FEB 28 2025 sales 5,252
Major Point: Dramatic 4-year snapshot on crashing sales (SF DOWN NEAR 60% OVER 2021/2022). But very steady prices in both condo and SF sectors.
2. ALL-TIME HIGHS ACHIEVED: (Comparing different months is only meaningful if you want to know ABSOLUTE HIGHS)
HIGHEST PAST MONTHLY PRICE AND SALES COMPARED TO FEBRUARY 2025.
3. VANCOUVER SF AND CONDOS
Sales and Prices own FEBRUARY over last FEBRUARY. Down sharply from June 2024. Well below the 10-year average.
VANCOUVER: Here is a 5-year month of FEB 2025 over the month of FEB 2024/2023/2022/2021 comparison.
Major Point:
V Condo – New Listings were up 16% y-o-y in FEBRUARY! Active Listings up 33%
SF Sales – Down 15% from 2024 and very sharply below 2022 and 2021 (more than -50%).
NOTE: Sales down y-o-y as well as listings up across the board!
FRASER VALLEY: Here is a 5-year FEB 2025 over FEB 2024/2023/2022/2021 comparison.
Major Point:
FV – SF Active listings up 29 % in February
FV – Condo Active Listings up 52% in February
FV – SF New listings up 29% in February!!!
Presales in Vancouver: Where are the buyers?
Lots of details on the ‘how and the wherefor’ in the last Ozbuzz 104 – revisit if you have an interest.
Yes, continuous new deals are being offered. PLUS, there are now some 5000 units finished and unsold.
AND YES, OZZIE IS TEMPTED!
Major Point: As last month: Keep making your low-ball offers … this is the best time to get your new digs (ready in 3-4 years). Rates are heading lower; deals will stop eventually.
MAJOR, MAJOR POINT: As always, we say that there is no best deal market, there are only best deals that you negotiate! And in 2025 you CAN negotiate.
Final thoughts: In every one of my books, I talk about “the most unreported inflation of hard assets in the world history” predict those HARD ASSET prices to continue to rise – after going thru the valley and buying real estate being STILL BEST! Whether I wrote it in 1998, 2008, 2016 etc. Nothing has changed. Timing makes me cautious now … but long term my views never changed.
“In Life, you do not get what you deserve! You get what you negotiate.”
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